Short term or Longer Lease Rentals? Furnished or Unfurnished?
First Paris, then Vancouver?
At Downtown Suites we have been recommending that owners rent their suites unfurnished for longer-term lease, rather than entering the short-term rental market. Although we do have some furnished suites available for short terms through Downtown Accommodations, our first advice to owners is to consider renting their suites unfurnished.
This article was in the Jordan Times while I was there, and it indicates that all is not roses for those in Paris who have set up short term rental suites to serve the market of foreign and business visitors to the city. Here in Vancouver we may begin to face similar restrictions. If you are an owner and considering renting your suite, this article can reveal some of the pitfalls.
Paris Cracks Down on Short-Term Apartment Rentals
Credit: Reuters/Charles Platiau
By Natalie Huet
PARIS | Thu Sep 22, 2011 8:32am EDT
(Reuters) – Paris, one of the world’s most-visited cities, is cracking down on short-term apartment rentals, dealing a blow to tourists looking for a bargain and entrepreneurial landlords hoping to recoup soaring property costs.
The allure of living in a Paris pied-Ã -terre for a week or month, and paying much less than for a hotel room, has created strong demand for short-term lodging, but its growing popularity has raised the ire of hotels and residential property owners.
Well, statistics don’t lie! If we look at the Quarterly Sales Graph, though, it can be seen that since 1997 the sales have been going up and down from 20k units to a couple of peaks in ’05 and ’06, but generally settle back down to the 20k range.
I am expecting we will see a levelling out again of transactions in this range, as there is still a lot of demand and interest rates are still very reasonable.
Remember, too, there is always a seasonal adjustment. Before panicking we have to see what happens in the economy in Q1 & 2 ’09.
With interest rates going lower, renters will again be enticed into the market as the affordability improves and the cost of ownership vis a vis renting will decline. I think it is part of our communal psyche now to want to own, and we have all seen that ultimately the market will rebound and capital gains will be made. Price is not the only factor, it is the affordability. People will be looking to see how possible slightly higher payments for owning vs renting will be offset in the long term by capital gains.
“The residential real estate market continues to deteriorate and we’ve seen the lowest number of Q3 sales in 5 years. What does this mean? It means that we should focus on the opportunities that are arising, including those for first time home buyers to make a sound investment at a much more reasonable price, and those for Lenders to tighten their borrowing standards to create a more sustainable and accountable financial sector.”
We’re grateful to Landcor data corporation for providing many of their compelling market reports free to their web site visitors.
Don’t run scared of the real estate market, we’re not…we’re doing more sales now than before…with over 30 years experience we’ve seen it all before! Call or email your local success story: www.downtownsuites.com.
